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Japan 'keen to maintain open dialogue to prevent trade friction with US'

Legislation | 5 February 2018

A new report has indicated that Japan is seeking to maintain an open dialogue with the US on trade to prevent any friction from arising, although concerns remain over the prospect.

The Japanese government is seeking to maintain an open but cautious dialogue with the US to prevent any potential trade frictions from becoming exacerbated, according to a report.

Officials and lawmakers have spoken anonymously to Reuters about the steps the country is taking to maintain good relations with the US under President Donald Trump, whose relationship with other key Asian nations has become strained in recent times.

Since his election, President Trump has pursued an "America First" trade policy that has prompted accusations of protectionism and resulted in new export restrictions on Chinese solar panels and South Korean washers, among other products.

The Trump administration has been adamant about the need to reduce its trade deficit with Asia, leading to concerns that Japan - which currently operates a seven trillion yen (€51.22 billion) trade surplus with the US - might be next in the firing line.

A ruling party lawmaker with a strong understanding of US-Japan economic ties said: "Naturally, America wants an early conclusion to what to do about its trade deficit. Of course, they are concerned about the midterm elections, and may say various things."

He added: "When it comes to what to do in concrete terms, everyone is at a loss. The situation is completely different from the trade friction of the 1980s."

So far, President Trump has maintained a good relationship with Japanese prime minister Shinzo Abe, resulting in a recent move to lift restrictions on Japanese persimmon exports and US Idaho potato imports, as well as to streamline noise and emissions testing for US auto imports.

However, disagreements could yet arise over the US' desire to cut Japan's trade surplus and establish a new bilateral framework for trade - goals that Japan does not share.